Then – Aug. – and now charts, as usual;

Timing is everything where stocks are concerned. When it comes to options timing is absolutely everything. It looked like a sure thing back in August as everything suggested a wave b or 2 was about to complete. Not so. First we needed a new high courtesy Mrs. Yellen at Jackson Hole. Our Sept. put with a strike of 585 at $4 with a target of $560 would have done just great if it had not expired! The November option with the same strike is presently trading above $30. It can be terrible frustrating when you are right (which we were not) and you still lose money, that is why you should be prepared to do many options.

The 585 Sept puts are now trading at about $2.55 to $3.30 with the Sox trading at $631 to $634 where there is a 62% retracement of the initial drop.

We were not looking when the previous option trade expired, if it already has. So here is another one. Try to buy the 585 Sept. put at $4. The c wave of this a-b-c which is a minimum structure should take the SOX down to about $560, the low point of the triangle. The option should have an intrinsic value of $25 plus some time left in it if this scenario pans out.

There is a very good opportunity for some drama this week. We have the Fed. fest in Jackson, Jackson Hole, Wyoming attended by both Yellen and Draghi plus a whole host of other academics that are pretending to understand the World. Forget about Ukraine, Isreal , Syria, the US interior and all those other hot spots. The real action will be in the wind swept plains of Wyoming and one slight or misstep could create untold havoc to the economies of the world. But don’t forget Mark Twain’s wise word, something like this “There are two times in a man’s life that he should not speculate, when he does not have the money and when he does”. When it comes to options I always add that you should only do the winning trades and leave the others alone. Good luck.

As a reminder, we show the “big picture” once again below;

The 600 August puts are trading at 5.30 t0 6.20 so they are now $4 cheaper than two weeks ago. If it was a buy then it should be even more of a buy now. Here are the updated charts;

The count is by no means clear but there are two nice triangles, the big one as a B-wave and the small one as a 4th wave. Both RSI and MACD are screaming sell more loudly than at any time in the past three years or more. On the bigchart the c is almost vector equal to the A and, at 600 plus the SOX has retraced about 62% of the drop from slightly above 1000.